Building Toward the Best

10/24/2009 2:00 AM Eastern

By: K.C. Neel

James Cownie, Co-founder/Past President, Heritage

Jim Cownie didn’t know much about the cable industry in 1970 when he and high school pal Jim Hoak decided to get into the business. But that didn’t stop the pair from eventually building the ninth-largest U.S. cable company, with more than 1 million customers in 22 states.

“Our goal was to become the best cable operator in the country,” Cownie said.

Cownie was working for an investment firm, and Hoak had just returned from a stint at the Federal Communications Commission when they drew up their plans for Hawkeye Cablevision, later Heritage Communications. Both men were 26 and full of enthusiasm for the fledgling industry.

Although the Des Moines, Iowa, City Council recommended another operator, Heritage won that city’s franchise after a hard-fought municipal election. Cowie and Hoak painstakingly built the system, often doing some heavy lifting themselves.

When they were finally able to offer TV signals — meager though they may have been at the time — the celebrations were short-lived: a lightning storm and tornado made mincemeat of the plant and much of it had to be rebuilt.

Still, Cownie was determined to forge ahead with expansion. Heritage at first added smaller, rural communities, but its strategy eventually migrated toward larger locales.

A publicly held company from the beginning, Heritage also acquired radio and TV stations and some manufacturing companies.

“It was a very exciting time in the cable industry,” Cownie said. “We were all fighting the same battles, and even though it was slow going until HBO went on the satellite, it was worth it.”

Cownie was always good at rallying the troops, said Hoak, who now runs Hoak Capital. “Jim’s a great guy and he is a great leader. He’s the kind of person who could assemble a terrific team,” Hoak said.

Those skills came in handy in the early days, when franchise wars were common and sales were often anemic due to a lack of compelling programming. Once HBO went live and other networks followed, though, the business started taking off.

“In the early days when we built the Des Moines system, it was, at one time, the largest completed system in the country with some 18,000 customers,” Hoak recalled. “And we were dying on the vine. We were living hand-to-mouth for a while. But then came HBO.

“I think we were the network’s second affiliate in February of 1974. It took some time to turn things around. But that service saved our bacon.”

To spur sales, Cownie befriended local electronics store owners, placing posters and flyers in the stores each week.

“Jim was ahead of his time with that retail strategy,” Hoak said.

Active in industry affairs, Cownie served as NCTA chairman in 1987 and on ad hoc committees dealing with customer service standards and industry proprietary programming.

In 1987, Tele-Communications Inc. bought Heritage for $1.5 billion. Hoak bought the TV and radio assets of Heritage and moved the company to Dallas.

TCI convinced Cownie and a group of Heritage executives to manage the Heritage properties for five years, but within three years, the partnership was dissolved.

Cownie, not ready to exit cable just yet, teamed with Meredith Corp., forming Meredith Cablevision. The systems in that partnership were sold in 1996.

Today, Cownie spends a good deal of time on philanthropic and family-focused endeavors. He and his wife, Patty, raised five kids, and adopted four more. He is active on several local and national boards. Recent philanthropic efforts include getting a YMCA built in one of Des Moines’s poorest neighborhoods.